Dec. 3 (Bloomberg) -- Crude oil futures declined to their lowest in more than five weeks before an OPEC production meeting and amid signs of an economic slowdown in the U.S., the world's largest energy user.

Consumer spending in the U.S. rose less than forecast in October, fuelling concern that growth is faltering. Twelve out of 22 analysts forecast that the Organization of Petroleum Exporting Countries will keep output levels unchanged at its Dec. 5 meeting in Abu Dhabi, according to a Bloomberg News survey.

``Participants are getting nervous both about the worsening macro backdrop in the U.S., as well as the upcoming OPEC meeting,'' Edward Meir, an analyst at MF Global Ltd. in Connecticut said in a report today.

Crude oil for January delivery fell as much as $1.24, or 1.4 percent, to $87.47 a barrel, its lowest on the New York Mercantile Exchange since Oct. 25. It last traded at $87.95 at 12:18 a.m. London time.

On Nov. 30, the contract fell $2.30, or 2.5 percent, to $88.71, taking the decline for the week to 9.7 percent. That was its biggest weekly loss in 2 1/2 years. New York crude oil futures closed at a record $98.18 a barrel on Nov. 23.

Brent crude oil for January settlement was at $87.57, down 69 cents, at 12:18 a.m. on the London-based ICE Futures Europe exchange. It fell 2.2 percent to $88.26 on Nov. 30.

Jobless Claims

U.S. consumer purchases increased 0.2 percent in October, compared with a gain of 0.3 the previous month, the Commerce Department said on Nov. 30. Jobless claims rose to a nine-month high of 352,000, Labor Department data released on the previous day showed.

Saudi Arabian Oil Minister Ali al-Naimi said on Dec. 1 there's ``absolutely ample'' supplies in the market, and Algerian Oil Minister Chakib Khelil said yesterday inventories are high. The International Energy Agency has urged OPEC to pump more to meet the seasonal peak in demand during the Northern Hemisphere winter.

``There's going to be a lot of volatility before the meeting -- it's hard to call what they're going to do,'' said Olivier Jakob, managing director of Petromatrix GmbH. ``OPEC would be worried about the global economy. The wealth they're getting out of oil sales is reinvested in financial markets.''

OPEC agreed to add 500,000 barrels a day to supplies starting in November at a Sept. 11 meeting, the first increase in more than a year, following requests by the U.S. and Europe to help ease prices. Oil has gained 44 percent this year.

Tanker Rates

``A substantial increase in OPEC crude-oil shipments,'' indicated by rising oil-tanker hire rates, may saddle the market with more high-sulfur crude than the global refining system can absorb, according to Francisco Blanch, head of global commodity research at Merrill Lynch & Co.

``The incremental supply of crude oil will likely exceed the market's ability to refine it,'' Blanch said in a report today. ``Oil prices could dip below $80 a barrel in the next few months.''

Morgan Stanley, the biggest oil trader on Wall Street, raised its long-term forecast for the price of West Texas Intermediate crude oil to $85 a barrel from $65 as it predicted higher costs and taxation.

``The petroleum industry will require higher prices to justify re-investment than previously thought,'' according to the report. ``Driving our changes are higher operating and capital costs, with increased rates of taxation.''

To contact the reporter on this story: Grant Smith in London at gsmith52@bloomberg.net

Last Updated: December 3, 2007 07:20 EST